Probiotec Limited's (ASX:PBP) CEO Compensation Is Looking A Bit Stretched At The Moment

editorial-team@simplywallst.com (Simply Wall St)
3 min read
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Key Insights

  • Probiotec's Annual General Meeting to take place on 15th of November

  • Salary of AU$591.6k is part of CEO Wes Stringer's total remuneration

  • Total compensation is 83% above industry average

  • Probiotec's EPS grew by 14% over the past three years while total shareholder return over the past three years was 34%

CEO Wes Stringer has done a decent job of delivering relatively good performance at Probiotec Limited (ASX:PBP) recently. This is something shareholders will keep in mind as they cast their votes on company resolutions such as executive remuneration in the upcoming AGM on 15th of November. However, some shareholders may still be hesitant of being overly generous with CEO compensation.

See our latest analysis for Probiotec

Comparing Probiotec Limited's CEO Compensation With The Industry

Our data indicates that Probiotec Limited has a market capitalization of AU$207m, and total annual CEO compensation was reported as AU$1.2m for the year to June 2023. Notably, that's an increase of 25% over the year before. While we always look at total compensation first, our analysis shows that the salary component is less, at AU$592k.

On comparing similar-sized companies in the Australian Pharmaceuticals industry with market capitalizations below AU$311m, we found that the median total CEO compensation was AU$673k. Hence, we can conclude that Wes Stringer is remunerated higher than the industry median. Furthermore, Wes Stringer directly owns AU$13m worth of shares in the company, implying that they are deeply invested in the company's success.

Component

2023

2022

Proportion (2023)

Salary

AU$592k

AU$565k

48%

Other

AU$640k

AU$419k

52%

Total Compensation

AU$1.2m

AU$984k

100%

On an industry level, roughly 61% of total compensation represents salary and 39% is other remuneration. Probiotec sets aside a smaller share of compensation for salary, in comparison to the overall industry. It's important to note that a slant towards non-salary compensation suggests that total pay is tied to the company's performance.

ceo-compensation
ceo-compensation

Probiotec Limited's Growth

Probiotec Limited has seen its earnings per share (EPS) increase by 14% a year over the past three years. Its revenue is up 17% over the last year.

Shareholders would be glad to know that the company has improved itself over the last few years. This sort of respectable year-on-year revenue growth is often seen at a healthy, growing business. Looking ahead, you might want to check this free visual report on analyst forecasts for the company's future earnings..

Has Probiotec Limited Been A Good Investment?

Most shareholders would probably be pleased with Probiotec Limited for providing a total return of 34% over three years. This strong performance might mean some shareholders don't mind if the CEO were to be paid more than is normal for a company of its size.

In Summary...

Seeing that the company has put up a decent performance, only a few shareholders, if any at all, might have questions about the CEO pay in the upcoming AGM. However, if the board proposes to increase the compensation, some shareholders might have questions given that the CEO is already being paid higher than the industry.

CEO compensation is a crucial aspect to keep your eyes on but investors also need to keep their eyes open for other issues related to business performance. That's why we did some digging and identified 1 warning sign for Probiotec that you should be aware of before investing.

Switching gears from Probiotec, if you're hunting for a pristine balance sheet and premium returns, this free list of high return, low debt companies is a great place to look.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team (at) simplywallst.com.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

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